NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR:  DANIER LEATHER INC.

TSX SYMBOL:  DL.SV

APRIL 20, 2005 - 16:16 ET

Danier Leather Reports Fiscal 2005 Third Quarter 
Results

TORONTO, ONTARIO--(CCNMatthews - April 20, 2005) - Danier Leather Inc. 
(TSX:DL.SV) today announced its consolidated financial results for the 
13 and 39 weeks ended March 26, 2005.

HIGHLIGHTS ($000s, except earnings per share):

/T/

---------------------------------------------------------------------
                                    13 Weeks Ended     39 Weeks Ended
---------------------------------------------------------------------
                                    March    March     March    March
                                 26, 2005 27, 2004  26, 2005 27, 2004
---------------------------------------------------------------------
Sales                             $46,527  $45,480  $140,895 $146,352
---------------------------------------------------------------------
EBITDA(1)                          $3,636   $2,792   $13,856  $14,270
---------------------------------------------------------------------
Net Earnings from Continuing
 Operations                        $1,353     $863    $5,765   $6,223
---------------------------------------------------------------------
Net Earnings (loss)                 ($794)    $531    $2,975   $5,407
---------------------------------------------------------------------
EPS Basic                          ($0.12)   $0.08     $0.44    $0.78
---------------------------------------------------------------------
EPS Diluted                           N/A    $0.08     $0.43    $0.77
---------------------------------------------------------------------
Number of Stores(2)                    96       99        96       99
---------------------------------------------------------------------
Square Footage                    375,689  378,355   375,689  378,355
---------------------------------------------------------------------

/T/

HIGHLIGHTS

- Sales increased 2% to $46.5 million, comparable store sales increased 
1% in the quarter

- Appointed new Vice President of Marketing

- Renewed normal course issuer bid and repurchased 402,400 subordinate 
voting shares year-to-date

- Company maintains a strong cash position and strong balance sheet

- Closed all three U.S. locations

"Although results for the third quarter were soft, the Company is taking 
steps to improve its performance," said Jeffrey Wortsman, President and 
CEO of Danier Leather. "We closed our U.S. stores and appointed a new 
Vice President of Marketing."

Sales for the third quarter increased 2% to $46.5 million from $45.5 
million in the third quarter of fiscal 2004, while comparable store 
sales increased 1%. Boxing Week took place in the third quarter this 
year versus the second quarter last year. As a result, the third quarter 
of 2005 included incremental Boxing Week revenue of about $5.8 million. 
Excluding Boxing Week, sales during the third quarter were below 
expectations.

Year to date revenues decreased by 4% or $5.5 million to $140.9 million 
compared with $146.4 million during the same period last year. 
Comparable store sales decreased by 5%. Several factors affected these 
results, including unseasonably warm weather during the second quarter, 
weak consumer spending on outerwear and weak consumer response to the 
Company's promotions.

EBITDA(1) during the third quarter increased to $3.6 million compared 
with $2.8 million last year. Year to date EBITDA(1) was $13.9 million 
compared with $14.3 million in 2004. Mainly due to costs associated with 
the closure of the U.S. operation, the Company posted at net loss for 
the quarter of $0.8 million, or $0.12 per share, compared to net 
earnings of $0.5 million or $0.08 per share, in the third quarter of 
fiscal 2004. On March 1, 2005, the Company paid a dividend of $0.06 per 
share on outstanding subordinate voting and multiple voting shares.

Danier maintains a strong financial position with working capital of 
$44.8 million and no long-term debt.

In March 2005, the Company announced that it would close its three U.S. 
locations, one in Paramus, New Jersey and two on Long Island, New York. 
All of the stores have been closed and a charge of approximately $1.5 
million was recognized during the third quarter for writing down fixed 
assets as well as lease and employee termination costs.

"Closing the three retail locations in the U.S. will enable Danier to 
focus on generating the superior returns from our Canadian operations 
that we have achieved in the past," added Mr. Wortsman. "As we move to 
differentiate our power centre stores from shopping mall locations and 
reinvigorate our marketing efforts, we expect results that are more 
reflective of Danier's historical performance."

About Danier

Danier Leather Inc. is a leading integrated designer, manufacturer, and 
retailer of high-quality leather and suede clothing and accessories. The 
Company's merchandise is marketed exclusively under the well-known 
Danier brand name and is available only at its 96 shopping mall, 
street-front, and power centre stores, or through its corporate sales 
division and online through its website, www.danier.com.

(1)EBITDA refers to earnings from continuing operations before interest 
expense, income tax, depreciation and amortization from continuing 
operations, and is a measure used by management to assess operating 
performance. EBITDA is a non-GAAP earnings measure and does not have a 
standardized meaning. It is therefore unlikely to be comparable to 
similar measures presented by other issuers.

(2)Number of stores: Financial results for all of the periods presented 
were restated by the Company to reflect the discontinuance of its U.S. 
operations, which consisted of three shopping mall stores. On March 31, 
2005, two of the U.S. shopping mall stores on Long Island were closed. 
The third U.S. store, in Paramus, New Jersey, closed in early April, 
2005.

Note: This press release may contain forward-looking statements that 
involve risks, estimates, and uncertainties. Therefore, actual results 
may differ materially. Examples of such risks and uncertainties include 
those associated with product sales, demand for Danier's products, 
availability of raw materials, foreign sourcing and manufacturing, 
weather, estimates associated with the closure of the U.S. operation, 
estimates of damages, costs and interest associated with the class 
action lawsuit, continued growth of the leather apparel industry, and 
competition and other associated risks with Danier's business. For an 
expanded discussion of risks and uncertainties, please see the documents 
filed by Danier Leather Inc. with the Ontario Securities Commission. 
Danier disclaims any responsibility to update or revise such 
forward-looking statements whether as a result of new information, 
future events or otherwise.

Investors, analysts and the media are invited to participate in a 
conference call today at 4:30 PM Eastern Time to discuss the results. 
Please dial 416-695-9748 in the Toronto area or 1-877-323-2093 (rest of 
Canada and the U.S.) and quote the Danier Leather Inc. conference call 
with chairperson Jeffrey Wortsman at least five minutes prior to the 
call. The call will also be webcast at www.danier.com or at 
www.ccnmatthews.com.

/T/

DANIER LEATHER INC.
CONSOLIDATED STATEMENTS OF EARNINGS AND RETAINED EARNINGS
(thousands of dollars, except earnings per share and number of shares
outstanding)
---------------------------------------------------------------------
---------------------------------------------------------------------

                                  For the 13              For the 39
                                 Weeks Ended             Weeks Ended
---------------------------------------------------------------------

                           March       March       March       March
                        26, 2005    27, 2004    26, 2005    27, 2004
---------------------------------------------------------------------
                      (unaudited) (unaudited) (unaudited) (unaudited)

Revenue                $  46,527   $  45,480   $ 140,895   $ 146,352
Cost of sales (Note 7)    23,781      24,488      70,030      74,421
                      -----------------------------------------------
Gross profit              22,746      20,992      70,865      71,931
Selling, general and
 administrative
 expenses (Note 7)        20,742      19,868      61,902      61,849
                      -----------------------------------------------
Earnings before
 interest and
 income taxes              2,004       1,124       8,963      10,082
Interest (income)
 expense                    (139)       (109)       (209)        102
                      -----------------------------------------------
Earnings from
 continuing operations
 before income taxes       2,143       1,233       9,172       9,980
Provision for income
 tax (Note 8)                790         370       3,407       3,757
                      -----------------------------------------------
Net earnings from
 continuing operations     1,353         863       5,765       6,223
(Loss) from discontinued
 operations, net of
 income taxes (Note 3)    (2,147)       (332)     (2,790)       (816)
                      -----------------------------------------------
Net earnings (loss)     $   (794)    $   531    $  2,975    $  5,407
                      -----------------------------------------------
                      -----------------------------------------------

Retained earnings,
 beginning of period      37,900      48,875      36,902      43,999
Share purchases (Note 6c)   (937)          -      (2,883)          -
Dividends                   (402)          -      (1,227)          -
                      -----------------------------------------------
Retained earnings,
 end of period         $  35,767   $  49,406   $  35,767    $ 49,406
                      -----------------------------------------------
                      -----------------------------------------------

Basic Earnings per
 Share:
 Continuing operations     $0.20       $0.12       $0.85       $0.90

 Net earnings (loss)      ($0.12)      $0.08       $0.44       $0.78
Diluted Earnings per
 Share:
 Continuing operations     $0.20       $0.12       $0.84       $0.89

 Net earnings (loss)         N/A       $0.08       $0.43       $0.77
Weighted Average Number
 of Shares Outstanding:
 Basic                 6,638,788   6,919,554   6,787,192   6,919,554
 Diluted               6,692,908   6,975,163   6,856,553   6,981,370
Number of Shares
 Outstanding           6,544,154   6,919,554   6,544,154   6,919,554


DANIER LEATHER INC.
CONSOLIDATED BALANCE SHEETS
(thousands of dollars)
---------------------------------------------------------------------
---------------------------------------------------------------------

                                       March       March        June
                                     26,2005     27,2004     26,2004
---------------------------------------------------------------------
                                  (unaudited) (unaudited)
ASSETS
Current Assets
 Cash                             $   20,665  $   21,369  $   22,576
 Accounts receivable                   1,599       1,265         626
 Inventories (Note 4)                 33,695      32,678      29,483
 Prepaid expenses                        797         562         903
 Assets of discountinued
 operations (Note 3)                     528       1,155         884
 Future income tax asset                 103       1,069         107
                                  -----------------------------------
                                      57,387      58,098      54,579
Other Assets
 Capital assets (Note 5)              26,424      29,862      28,891
 Goodwill                                342         342         342
 Assets of discontinued operations
 (Note 3)                                  -       1,414       1,321
 Future income tax asset               4,572           -       4,736
                                  -----------------------------------
                                  $   88,725  $   89,716  $   89,869
                                  -----------------------------------
                                  -----------------------------------

LIABILITIES
Current Liabilities
 Accounts payable and accrued
 liabilities                      $   10,855  $   11,309  $    9,355
 Income taxes payable                  1,364       1,656         952
 Liabilities of discontinued
  operations (Note 3)                    359         153          70
                                  -----------------------------------
                                      12,578      13,118      10,377

Accrued litigation provision
 and related expenses (Note 9)        15,223         179      15,450
Deferred lease inducements             1,988       2,322       2,283
Future income tax liability              470         696         472
                                  -----------------------------------
                                      30,259      16,315      28,582
                                  -----------------------------------

SHAREHOLDERS' EQUITY
 Share capital (Note 6)               22,480      23,995      24,166
 Contributed surplus                     219           -         219
 Retained earnings                    35,767      49,406      36,902
                                  -----------------------------------
                                      58,466      73,401      61,287
                                  -----------------------------------
                                  $   88,725  $   89,716  $   89,869
                                  -----------------------------------
                                  -----------------------------------


DANIER LEATHER INC.
CONSOLIDATED CASH FLOW STATEMENTS
(thousands of dollars)
---------------------------------------------------------------------
---------------------------------------------------------------------
                                  For the 13              For the 39
                                 Weeks Ended             Weeks Ended
---------------------------------------------------------------------
                           March       March       March       March
                        26, 2005    27, 2004    26, 2005    27, 2004
                      (unaudited) (unaudited) (unaudited) (unaudited)
Operating activities
Net earnings (loss)
 for the period         $   (794)    $   531    $  2,975    $  5,407
 Items not affecting
  cash:
 Amortization -
  continuing operations
  (Note 7)                 1,632       1,668       4,893       5,004
 Amortization -
  discontinued operations
  (Note 7)                 1,160          85       1,330         255
 Amortization of
  deferred lease
  inducements                (99)        (96)       (295)       (280)
 Future income taxes          61          29         166         (25)
Change in non-cash
 working capital items
 (Note 10)                    97       6,044      (3,394)      6,420
Discontinued operations
 (Note 3)                  1,315          74         645         568
                      -----------------------------------------------
Cash flows from operating
 activities                3,372       8,335       6,320      17,349
                      -----------------------------------------------

Financing activities
 Subordinate voting
 shares issued                 -           -          14           -
 Subordinate voting
 shares repurchased       (1,608)          -      (4,583)          -
 Dividends                  (402)          -      (1,227)          -
 Proceeds from lease
 inducements                   -           -           -         364
                      -----------------------------------------------
Cash flows from
 financing activities     (2,010)          -      (5,796)        364
                      -----------------------------------------------

Investing activities
 Acquisition of capital
  assets                    (394)       (322)     (2,435)     (2,289)
                      -----------------------------------------------

Cash flows from
 investing activities       (394)       (322)     (2,435)     (2,289)
                      -----------------------------------------------

Increase in cash             968       8,013      (1,911)     15,424

Cash, beginning of
 period                   19,697      13,356      22,576       7,081
                      -----------------------------------------------

Cash, end of period   $   20,665   $  21,369   $  20,665   $  22,505
                      -----------------------------------------------
                      -----------------------------------------------

Supplementary cash
 flow information:
 Interest paid                 -           5           3         223
 Income taxes paid           760          10       3,020       2,043

/T/

1. SIGNIFICANT ACCOUNTING POLICIES:

(a) Basis of Presentation:

The interim financial statements presented herein follow the same 
accounting policies and their methods of application as the 2004 annual 
financial statements. Generally accepted accounting policies ("GAAP") 
for interim financial statements do not conform in all respects to the 
disclosures required for annual financial statements, and accordingly, 
these interim financial statements should be read in conjunction with 
the Company's audited consolidated financial statements and the 
accompanying notes contained in the Company's 2004 Annual Report.

The preparation of financial statements in conformity with Canadian 
generally accepted accounting principles requires management to make 
estimates and assumptions that affect the reported amounts of assets and 
liabilities and disclosure of contingent assets and liabilities at the 
date of the financial statements and the reported amounts of revenues 
and expenses during the reporting period. These estimates and 
assumptions are based on management's best knowledge of current events 
and actions that the Company may undertake in the future. Significant 
areas requiring the use of management estimates relate to the 
determination of litigation award reserves, inventory valuation, 
realizable value of capital assets, deferred tax assets, and income tax 
provisions. By their nature, these estimates are subject to measurement 
uncertainty and the impact on the consolidated financial statements of 
future periods could differ materially from those estimated.

(b) Comparative Figures:

Certain of the prior period's figures were reclassified to conform with 
the current period's financial statement presentation.

2. SEASONALITY OF RETAIL OPERATIONS:

Due to the seasonal nature of the retail business and the Company's 
product lines, the results of operations for any interim period are not 
necessarily indicative of the results of operations to be expected for 
the fiscal year. Generally, a significant portion of the Company's sales 
and earnings are generated during the fiscal second quarter, which 
includes the holiday selling season. Sales are generally lowest and 
losses are experienced during the period from April to September.

3. DISCONTINUED OPERATIONS:

In March 2005 the Company announced that it would discontinue its U.S. 
operations which consisted of 3 shopping mall stores. On March 31, 2005, 
two of the U.S. shopping mall locations located on Long Island, New York 
were closed. The third store located in Paramus, New Jersey was closed 
in April 2005.

Financial results for all of the periods presented were restated to 
reflect the discontinuance of the U.S. operations. The results of 
discontinued operations for the 13 and 39 week periods ended March 26, 
2005 and March 27, 2004 were as follows:

/T/

                          13 weeks ended              39 weeks ended
             --------------------------------------------------------
              Mar 26, 2005  Mar 27, 2004  Mar 26, 2005 Mar  27, 2004 
             --------------------------------------------------------
Sales                 $695          $694        $2,260        $2,416 
             --------------------------------------------------------
Operating loss        (684)         (332)       (1,327)         (816)
Write-down of fixed
 assets             (1,075)            -        (1,075)            - 
Lease and employee
 termination costs    (388)            -          (388)            - 
Income taxes             -             -             -             - 
             --------------------------------------------------------
Loss from
 Discontinued
 operations        ($2,147)        ($332)      ($2,790)        ($816)
             --------------------------------------------------------


The net assets of discontinued operations are summarized as follows:

                      March 26, 2005   March 27, 2004   June 26, 2004
                     ------------------------------------------------
Current assets                $  528         $  1,155          $  884
Fixed assets                       -            1,414           1,321
                     ------------------------------------------------
                                 528            2,569           2,205
Current liabilities              359              153              70
                     ------------------------------------------------
Net assets from discontinued
 Operations                   $  169         $  2,416        $  2,135
                     ------------------------------------------------
                     ------------------------------------------------


Changes in non-cash operating working capital items of discontinued
operations are summarized as follows:

                          13 weeks ended               39 weeks ended
             --------------------------------------------------------
              Mar 26, 2005  Mar 27, 2004  Mar 26, 2005 Mar  27, 2004 
             --------------------------------------------------------
Current assets      $1,132          $145          $356         ($583)
Current liabilities    183           (71)          289            15 
             --------------------------------------------------------
                    $1,315           $74          $645         ($568)
             --------------------------------------------------------

4. INVENTORIES (thousands of dollars):

                      March 26, 2005   March 27, 2004   June 26, 2004
                     ------------------------------------------------
Raw materials               $  3,938         $  5,231        $  4,043
Work-in-process                  848            1,175           1,363
Finished goods                28,909           26,272          24,077
                     ------------------------------------------------
                           $  33,695        $  32,678       $  29,483
                     ------------------------------------------------
                     ------------------------------------------------

5. CAPITAL ASSETS (thousands of dollars):

                        March 26, 2005                 March 27, 2004
         ------------------------------------------------------------
                  Accumulated Net Book          Accumulated  Net Book
            Cost Amortization    Value    Cost Amortization     Value
         ------------------------------------------------------------
Land      $1,000       $    -   $1,000  $1,000       $    -  $  1,000
Building   7,066        1,327    5,739   6,885        1,171     5,714
Leasehold
 Improve-
 ments    26,710       14,083   12,627  25,719       11,392    14,327
Furniture
 And
 Equip-
 ment     12,444        7,916    4,528  12,559        7,058     5,501
Computer
 Hardware
 And
 software  9,396        6,866    2,530   9,420        6,100     3,320
         ------------------------------------------------------------
         $56,616      $30,192  $26,424 $55,583    $  25,721 $  29,862
         ------------------------------------------------------------
         ------------------------------------------------------------


                                        June 26, 2004
                  -----------------------------------
                              Accumulated    Net Book
                     Cost    Amortization       Value
                  -----------------------------------
Land              $ 1,000         $     -      $1,000
Building            7,066           1,080       5,986
Leasehold
 Improvements      25,174          11,887      13,287
Furniture and
 Equipment         12,070           7,017       5,053
Computer hardware
 and software       8,883           5,318       3,565
                  -----------------------------------
                  $54,193         $25,302     $28,891
                  -----------------------------------
                  -----------------------------------

6. SHARE CAPITAL (thousands of dollars, except per share amounts):

(a) Authorized

1,224,329 Multiple Voting Shares

Unlimited Subordinate Voting Shares

Unlimited Class A Preference Shares

(b) Issued

                     March 26, 2005   March 27, 2004   June 26, 2004 
                    -------------------------------------------------

1,224,329 Multiple
 Voting Shares
 (March 27, 2004 and
 June 26, 2004-
 1,224,329)                      (a)              (a)             (a)
5,319,825 Subordinate
 Voting Shares
 (March 27, 2004-
 5,695,225 and
 June 26, 2004-
 5,720,225)                  22,480           23,995          24,166 
                    -------------------------------------------------
                        $    22,480     $     23,995    $     24,166 
                    -------------------------------------------------
                    -------------------------------------------------
(a) Nominal

The following transactions occurred during the first 39 weeks of the
fiscal year with respect to the Subordinate Voting shares:

                            39 Weeks Ended             39 Weeks Ended
                            March 26, 2005             March 27, 2004
                       ----------------------------------------------
                           Number        $            Number        $
                       ----------------------------------------------
Shares outstanding at
 beginning of
 the period             5,720,225  $24,166         5,695,225  $23,995
Issued                      2,000       14                 -        -
Repurchased              (402,400)  (1,700)                -        -
                       ----------------------------------------------
Shares outstanding at
 end of the period      5,319,825  $22,480         5,695,225  $23,995
                       ----------------------------------------------
                       ----------------------------------------------

/T/

(c) Normal course issuer bid

On February 2, 2005, the Company received approval from the Toronto 
Stock Exchange to renew its normal course issuer bid. The bid permits 
the Company to acquire up to 421,061 subordinate voting shares, 
representing approximately 10% of the public float of the subordinate 
voting shares, during the period from February 7, 2005 to February 6, 
2006. During the 13 and 39 week periods ended March 26, 2005, 158,800 
and 402,400 Subordinate Voting Shares, respectively, were purchased for 
cancellation at prevailing market prices for cash consideration of 
$1,608,000 and $4,583,000, respectively. The excess of $937,000 and 
$2,883,000, respectively, over the average paid-in value of the shares 
was charged to retained earnings.

(d) Stock option plan

As at March 26, 2005, the Company has reserved 913,275 Subordinate 
Voting Shares for issuance under its Stock Option Plan. As at March 26, 
2005, there were 627,400 options outstanding with exercise prices 
ranging from $6.02 to $17.94. Of these outstanding options, 572,650 are 
exercisable. During the 39 weeks ended March 26, 2005 no stock options 
were granted. Further details of the Stock Option Plan are contained in 
Note 6(e) of the consolidated financial statements contained in the 2004 
Annual Report.

In September 2003, the CICA amended Handbook Section 3870 to require the 
use of the fair value-based method to account for stock options, 
commencing with fiscal years beginning on or after January 1, 2004. 
Under the fair value-based method, compensation cost is measured at fair 
value at the date of the grant and is expensed over the vesting period. 
In accordance with the permitted transitional options, during the fourth 
quarter of 2004, the Company prospectively applied the fair value-based 
method to all stock options granted on or after June 29, 2003.

Options granted during the year ended June 28, 2003 continue to be 
accounted for using the settlement accounting method. During that year, 
the Company granted 111,000 stock options (net of 25,000 forfeited 
options during fiscal 2003 and 50,000 forfeited options during fiscal 
2004) with an exercise price of $15.85. Had compensation cost been 
determined using the fair value-based method at the grant date of the 
stock options awarded to employees and directors, the net earnings and 
earnings per share for the 13 and 39 weeks ended March 26, 2005 and 
March 27, 2004 would have been reduced to the pro forma amounts 
indicated in the following table:

/T/

                            13 Weeks Ended          13 Weeks Ended
                            March 26, 2005          March 27, 2004
                       ----------------------------------------------
                       As Reported  Pro-forma  As Reported  Pro-forma
                       ----------------------------------------------
Net earnings (loss)          ($794)     ($854)        $531       $471
Basic earnings (loss)
 per share                  ($0.12)    ($0.13)       $0.08      $0.07
Diluted earnings per share     N/A        N/A        $0.08      $0.07


                            39 Weeks Ended          39 Weeks Ended
                            March 26, 2005          March 27, 2004
                       ----------------------------------------------
                       As Reported  Pro-forma  As Reported  Pro-forma
                       ----------------------------------------------
Net earnings                $2,975     $2,794       $5,407     $5,226
Basic earnings per share     $0.44      $0.41        $0.78      $0.76
Diluted earnings per share   $0.43      $0.41        $0.77      $0.75

/T/

The pro forma effect on net earnings of the period is not representative 
of the pro forma effect on net earnings of future periods because it 
does not take into consideration the pro forma compensation cost related 
to options awarded prior to June 29, 2002.

The fair value of options granted during fiscal 2003 and fiscal 2004 was 
estimated on the grant date using the Black-Scholes Option Pricing 
Model. The Black-Scholes Option Pricing Model was developed for use in 
estimating the fair value of traded options, which have no vesting 
restrictions and are fully transferable. In addition, the Black-Scholes 
Option Pricing Model requires the use of subjective assumptions 
including the expected stock price volatility. As a result the Company's 
stock option plan having characteristics different from those of traded 
options, and because changes in the subjective assumptions can have a 
material effect on the fair value estimate, the Black-Scholes Option 
Pricing Model does not necessarily provide a reliable single measure of 
the fair value of options granted.

(e) Deferred Share Unit Plan

Effective October 19, 2004, the Company established a Deferred Share 
Unit ("DSU") Plan for non-employee directors. Under this plan, 
non-employee directors of the Company receive an annual grant of DSU's 
and can also elect to receive their annual retainers and meeting fees in 
DSU's. The number of DSU's issued is based upon the market value of the 
Company's subordinate voting shares at each allocation date during the 
year. After retirement from the board, these directors receive a cash 
payment equal to the market value of the accumulated DSU's. During the 
quarter ended December 25, 2004, each non-employee director was issued 
1,200 DSU's. No DSU's were issued during the 13 weeks ended March 26, 
2005. The number of DSU's issued each year, multiplied by the market 
value of the subordinate voting shares, is recorded as an expense by the 
Company.

7. AMORTIZATION (thousands of dollars):

Amortization included in cost of sales and selling, general and 
administrative expenses ("SG&A") is summarized as follows:

/T/

                                   13 weeks ended      39 weeks ended
                               --------------------------------------
                                    Mar       Mar       Mar       Mar
                               26, 2005  27, 2004  26, 2005  27, 2004
                               --------------------------------------
Cost of sales                      $195      $185      $585      $554
SG&A of continuing operations     1,437     1,483     4,308     4,450
                               --------------------------------------
Continuing operations             1,632     1,668     4,893     5,004
SG&A of discontinued operations   1,160        85     1,330       255
                               --------------------------------------
                                 $2,792    $1,753    $6,223    $5,259
                               --------------------------------------

8. INCOME TAXES (thousands of dollars):

The Company's effective income tax rate consists of the following:

                                          Mar 26, 2005 Mar 27, 2004
                                          ---------------------------
Combined basic federal and provincial
 average statutory rate                           36.1%        37.0%
Manufacturing and processing credit               (0.5%)       (0.9%)
Other                                              1.5%         1.5%
                                          ---------------------------
                                                  37.1%        37.6%
                                          ---------------------------
                                          ---------------------------

9. LITIGATION PROVISION AND RELATED EXPENSES:

                                           Mar 26, 2005  Mar 27, 2004
                                           --------------------------
Provision for damages, costs and interest     $  15,000     $       -
Legal and professional fees                         223           179
                                           --------------------------
Accrued litigation provision and related
 expenses                                     $  15,223     $     179
                                           --------------------------
                                           --------------------------

/T/

In fiscal 1999, the Company and certain of its directors and officers 
were served with a Statement of Claim under the Class Proceedings Act 
(Ontario) concerning the accuracy and disclosure of certain information 
contained in a financial forecast issued by the Company during its 
initial public offering ("IPO") in 1998. The suit sought damages be paid 
equal to the alleged diminution in value of the shares.

In October 2001, a motion to certify the action as a class action was 
granted. The trial commenced in the Superior Court of Justice (Ontario) 
during May 2003 and was completed in January 2004. On May 7, 2004 the 
Judge issued a judgment in favour of the Plaintiffs and awarded damages 
to Canadian shareholders who purchased subordinate voting shares in the 
IPO. The Judge concluded that at the time of pricing of the IPO, which 
was two weeks before the closing, the forecast was reasonable and that 
the Company's CEO and CFO had an honest belief at the time the IPO 
closed that the forecast could be achieved. The Judge further held that 
the forecast was, in fact, substantially achieved. Despite these 
findings, the Court decided that management's judgement that the 
forecast was still achievable at the time of closing was not reasonable. 
The Company is contesting this decision and has filed a Notice of Appeal 
as discussed below.

For those shareholders who sold their shares between June 4 and 9, 1998, 
the Court awarded them the difference between the IPO price and the 
price at which they sold their shares. For those shareholders who sold 
or still hold those shares after June 9, 1998, the Court awarded $2.35 
per share.

Based solely on the information currently available, if the award had 
been paid at the fiscal 2004 year-end, the Company estimates the damages 
to be about $10 million. Interest and costs have not been dealt with by 
the Court but if awarded, the Company estimates the total award could 
increase by approximately $7 million. During the fourth quarter of 2004, 
the Company recorded an expense and set up a provision of $15 million 
pursuant to this judgment. The judgment is a joint and several 
responsibility of the Company and two of its Senior Officers. The 
Company carries directors and officers insurance and it expects that the 
insurance will cover the two Senior Officers' portion of the total award 
but the amount of insurance is not reasonably determinable at this time 
and its recovery has therefore not been accrued. The provision for 
recovery of income taxes related to the award is based on the entire $15 
million provision and does not take account of the potential results of 
the appeal discussed in the next paragraph, any possible insurance 
recoveries or future tax adjustments. The damages award and income tax 
recovery is based on management's best estimate and is subject to 
adjustment when all facts are known and all issues are resolved. The 
possible adjustment could be significant.

In June 2004, a Notice of Appeal was filed by the Company and two of its 
senior officers. The appeal is scheduled to be heard during June 2005. 
Payment of any damages will be deferred as the award and the judgment 
are stayed by the filing of the appeal.

During the years ended June 26, 2004 and June 28, 2003, a provision for 
future legal and professional fees was set up in the amounts of $0.5 
million and $1.2 million, respectively. As at March 26, 2005, the 
provision for future legal and professional fees in connection with the 
appeal was $0.2 million and as at March 27, 2004, the provision for 
future legal and professional fees related to the trial was 
approximately $0.2 million.

10. CHANGES IN NON-CASH OPERATING WORKING CAPITAL ITEMS (thousands of 
dollars):

/T/

                                   13 weeks ended     39 weeks ended
                                -------------------------------------
                                     Mar      Mar       Mar      Mar
                                26, 2005 27, 2004  26, 2005 27, 2004
                                -------------------------------------
Accounts receivable                ($465)  $5,382     ($973)   ($672)
Inventories                        6,397    9,331    (4,212)   3,960
Prepaid expenses                    (205)     (24)      106      326
Accounts payable and accrued
 liabilities                      (5,494)  (8,982)    1,273    1,067
Income taxes payable                (136)     337       412    1,739
                                -------------------------------------
                                     $97   $6,044   ($3,394)  $6,420
                                -------------------------------------

/T/

11. COMMITMENTS AND CONTINGENCIES - (thousands of dollars):

(a) Operating leases

Minimum rentals for the next five fiscal years and thereafter, excluding 
rentals based upon revenue are as follows:

/T/

2006                                              $  11,315
2007                                              $  10,791
2008                                              $   9,681
2009                                              $   7,873
2010                                              $   5,848
Thereafter                                        $  11,743

/T/

(b) Letters of credit

The Company had outstanding letters of credit in the amount of $1,744 
(March 27, 2004 - $1,917; June 26, 2004 - $6,804) for imports of 
finished goods inventories to be received.

(c) Guarantees

In the normal course of business, the Company enters into numerous 
agreements that may contain features that meet the AcG-14 definition of 
a guarantee. AcG-14 defines a guarantee to be a contract (including an 
indemnity) that contingently requires the Company to make payments to 
the guaranteed party based upon certain criteria including failure of 
another party to perform under an obligating agreement or failure of a 
third party to pay its indebtedness when due.

The Company has provided the following guarantees to third parties and 
no amounts have been accrued in the financial statements for these 
guarantees:

(i) In the ordinary course of business, the Company has agreed to 
indemnify its lenders under its credit facility against certain costs or 
losses resulting from changes in laws and regulations or from a default 
in repaying a borrowing. These indemnifications extend for the term of 
the credit facility and do not provide any limit on the maximum 
potential liability. Historically, the Company has not made any 
indemnification payments under such agreements.

(ii) In the ordinary course of business, the Company has provided 
indemnification commitments to certain counterparties in matters such as 
real estate leasing transactions, director and officer indemnification 
agreements and certain purchases of fixed assets such as computer 
software. These indemnification agreements generally require the Company 
to compensate the counterparties for costs or losses resulting from 
legal action brought against the counterparties related to the actions 
of the Company. The terms of these indemnification agreements will vary 
based on the contract and generally do not provide any limit on the 
maximum potential liability.

(iii) The Company sublet one location during fiscal 2004 and has 
provided the landlord with a guarantee in the event the subtenant 
defaults on its obligation to pay rent. The term of the guarantee is 
approximately 4 years and the Company's maximum exposure is $149.


12. SEGMENTED INFORMATION - (thousands of dollars):

Management has determined that the Company operates in one dominant 
industry and geographic segment which involves the design, manufacture 
and retail of fashion leather and suede apparel.

-30-

Investor Relations Contact: Danier Leather Inc.
Jeffrey Wortsman
(416) 762-8175 ext. 302
(416) 762-7408 (FAX)
leather@danier.com

or

Danier Leather Inc.
Bryan Tatoff
Senior Vice-President and Chief Financial Officer
(416) 762-8175 ext. 328
(416) 762-7408 (FAX)
bryan@danier.com